Software Investments—Looking Beyond the Surface

Software Investments—Looking Beyond the Surface

Rockwell Automation through Blake Moret, chairman and CEO, invested $1 billion in PTC with Moret gaining a seat on the board. The public reason was really to get early information about ThinkWorx, the IIoT product.

The investment valued PTC, a company with $1 billion in sales, at approximately $17 billion. On the surface, we all pondered why.

Speeding up the time, I was able to spend a couple of hours with several people from PTC at last week’s Automation Fair event. This really opened my eyes to the depth and breadth of the ThingWorx offering. There is much technology and usefulness under the hood. This is powerful software.

Now, I understand. Beyond a relationship and most likely some preferential access to ThingWorx and other PTC technologies, I’m surmising that Rockwell Automation can also drop some visualization projects, cut development costs, and utilize the full value of the PTC software. That alone would be a good return on the investment.

Therefore, the most prominent branding at Automation Fair–Powered by PTC.

Revealing more of Rockwell’s piece-at-a-time partnering strategy, it is not using PTC’s CAD and PLM offerings for its digital twin development, but instead it is partnering with ANSYS.

Like I noted in my initial report on Automation Fair, partnering was the centerpiece of news from the event. Looks like it is also the centerpiece of product development. That is most likely financially prudent.

Software Investments—Looking Beyond the Surface

Tech Podcast and Numbers

Gary on Manufacturing Podcast 200 has been published.

I have been podcasting in a variety of formats since around 2007. Obviously frequency is a problem. After I left magazine publishing, I spent some time figuring which direction to go.

This podcast (sponsored by Inductive Automation) gives a quick recap of where the podcast has been and then I take a look at challenges for industrial tech for the future.

On another note, yesterday I published two blog posts regarding market intelligence (or, lack thereof) reports.

One showed transparent methodology that yields granular data that is perhaps as trustworthy as possible.

The other had to have been a huge SWAG (strategic wild-assed guess). It was not transparent (despite the name of the firm including the word “transparent”) with results not passing the smell test.

The other press releases I get this time of year are magazine awards. I know how the sausage is made. I also heard John C. Dvorak once an editor with PC Magazine back in the day say the same things about PC Mag’s editor awards. Suffice to say, I don’t report on them. I’m happy the companies got an award for their relationship with the magazine, but it’s not relevant to this site.

Good information is so hard to come by. Sometimes I like to stir things up, but mostly I just like to give a clear unbiased view.

Let’s just say I can still remember my roots when I actually worked for a living–life on the line getting projects done and manufacturing producing.

Software Investments—Looking Beyond the Surface

Market Research Firm Says Digital Transformation to Drive Adoption of Manufacturing Operations Management Software

‘Tis the season—for market research reports. This one again from a firm I don’t know (but quite European centric)—by Transparence Market Research attempts to gauge the size and growth of the Manufacturing Operation Management (MOM) software market. I did not get a chance to chat with the company, but I find the list of companies “surveyed” interesting. Note, this software was previously (before ISA 95) Manufacturing Execution Solutions (MES), and when I did work in the space Manufacturing (prior-Materials) Resource Planning.

According to the market report, the global manufacturing operations management software market is projected to reach a value of US$ 17 Bn by 2027. The MOM software market is projected to expand at a CAGR of about 10% from 2019 to 2027. Growth of the market can be attributed to the shift of manufacturing toward digitization. [Note: I propose that as companies have acquired other companies, the MOM of choice—Microsoft Excel—became to cumbersome and not scalable. Add to this thought, the burgeoning data available through the Internet of Things.]

Asia Pacific is anticipated to dominate the manufacturing operations management software market at a CAGR of about 11% during the forecast period. In terms of revenue share, the manufacturing operations management software market is dominated by North America, followed by Europe. In 2019, the software segment is estimated to be valued at about US$ 5 Bn in the global manufacturing operations management software market, and see an opportunity of about US$ 10 Bn in terms of revenue from 2019 to 2027, reflecting a CAGR of about 9% during the forecast period.

The report does rightly point out that “MOM plays a vital role in integrating information systems on the shop floor, with business systems in corporate offices, leading to a gradual phasing-out of traditional paper-based systems.” They expect demand for manufacturing operations management software to increase during the forecast period due to these advantages offered by these systems.

Asia Pacific is one of the fastest growing markets in the global manufacturing operations management software market, as this region is witnessing increased adoption of new technologies. The manufacturing operations management software markets in North America and Europe are also expected to expand rapidly during the forecast period. [Gary’s note: have you ever seen one of these reports where the line on the graph did not reach upward from lower left to upper right?]

The research study includes the profiles of leading companies operating in the global manufacturing operations management software market. Key players profiled in the report include Siemens AG, ABB Ltd., Dassault Systems SA, Emerson Process Management, Honeywell, International Inc., General Electric Co., and Invensys plc. [Note: I’ll give them Invensys for historical data, but the software is now aggregated under AVEVA. I’d suggest a few additional players in the space.]

​​​​Motor Drives Increasingly An Enabler of IoT Says Market Intelligence Firm

​​​​Motor Drives Increasingly An Enabler of IoT Says Market Intelligence Firm

Just before Thanksgiving, I had the opportunity to talk with Adrian Lloyd, CEO of Interact Analysis. Interact is a new market research and intelligence company composed of industry veterans of other firms. The company researchers perform many more interviews than the industry norm combining with deep regional manufacturing data in order to achieve better and more granular results.

Company CEOs provided insight to me years ago about the accuracy (or lack) of many market analyses. I’m always in search of better information. We’ll try this one.

Interact has just released two reports—low voltage AC drives and motion control.

2019 low voltage AC motor drives report from Interact Analysis

  • Decentralized and motor mounted drives to show the strongest growth
  • Danfoss overtook Siemens in 2018 to be number 1 drives supplier to the EMEA region
  • Cabinet mounted general purpose drives have largest percentage of sales by product type

The research shows that growth in the intralogistics and materials handling sector has led to increased demand for decentralised and motor mounted drives, leading them to show the strongest growth over the five-year forecast period out of all seven product types covered. Cabinet mounted general purpose drives account for nearly half of drive sales globally, but also represent the slowest growing product type.

Meanwhile, from a regional perspective, although ABB is the number 1 drives supplier on a global basis, Danfoss has overtaken Siemens to be number 1 in EMEA. The Americas is predicted to be the fastest growing drives market for 2019, while the market in EMEA is shrinking, and China continues to occupy the largest share of the market (43% by unit shipments in 2019).

Interact Analysis has pioneered a new forecasting approach that gives an unprecedented level of detail. For example, users could choose to view anticipated demand for drives under 2.2 kW in the Indian packaging market. This is possible because the report is underpinned by 12 years of data on industrial production (the value of goods produced) and machinery production (the value of the machines used to produce goods). This information comes from Interact Analysis’s Manufacturing Industry Output Tracker – a big data tool that aggregates national manufacturing surveys from all major manufacturing economies in a set of over 1.2 million datapoints.

Lloyd says of this report: “In 2018 average drive prices fell by 2.7% compared with 2017, and we expect this trend to continue. To compound this, 2019 is experiencing a slowdown in the market. Yet the drives industry has reason for positivity. And not just because we expect the market to rebound in 2020.

“The world is becoming increasingly automated – in fact it is becoming rare to open a national daily newspaper and not read something about how automation is impacting the economy. Automation growth sectors, such as eCommerce warehouses, are creating vast new opportunities for drives. In the longer run, it is very positive for drives manufacturers that our research shows drives buyers increasingly see drives as the front line of predictive maintenance and industrial IoT.

“Most drives reports model industry dynamics by simply comparing the growth of the drives market with the growth of the entire manufacturing sector. Ours is different. Interact Analysis’s Manufacturing Industry Output tracker compares the value of goods produced with the value of machines used to produce goods to give a whole range of fresh new insights unavailable in any other drives report.”

Motion Control Market to Exceed $15bn by 2023

New 2019 motion control market report from Interact Analysis reveals

  • Despite a short-term dip in 2019, longer term forecasts predict solid growth
  • Increased reliance on industrial robotics a significant contributor
  • Growth rate to exceed that of global manufacturing production by 2020

Interact Analysis has released a new market report – Motion Controls – 2019 – pointing to strong growth over the next four years for motion control products.

Despite a small decline in 2019 (-3.8%) the report outlines how the market for motion control products will grow strongly, ultimately exceeding $15bn in 2023. Also noteworthy is the firm’s belief that the motion control market will outpace growth of global manufacturing production from 2020 onwards. The positive outlook holds true despite the torrid time currently facing machine tool vendors which, as the single largest consumer of motion control products, generated over a third of motion control revenues in 2018.

Interact Analysis points to several sectors which are helping to drive a more positive outlook for motion controls. These include food & beverage machinery, packaging machinery, robotics and material handling equipment, especially equipment for warehouse automation and intralogistics. Together these sectors generated just under a quarter of total motion control revenues in 2018 and are forecast to account for closer to 30% in 2023.

The report outlines further factors strengthening the outlook for motion control demand, including the trend for decentralization. Here higher-protection ratings are helping to advance the market for particular motion products. Although even combined the opportunity is small compared to the total (representing only 2.4% of the global market in 2018), the findings show that revenues for both products are projected to experience higher growth than the rest of the market, driving their combined value to exceed $500m in 2023.

Geographically, six regions – China, USA, Japan, Germany, Italy and South Korea – will continue to dominate market revenues. China, in particular, is expected to add significant revenues over the next four years, making it almost twice as big as the United States. In industry terms, sectors utilising metal cutting tools remain the largest in revenue terms, however the strongest overall growth during the forecast period came from mobile robots and industrial robots, which are the only ones forecast to experience growth in 2019 versus 2018.

Tim Dawson, research director for Interact Analysis and principal analyst of the motion controls report, said: “Although the motion control market may be considered fairly mature there are important trends impacting its future growth helping drive revenues at an above average rate for the long-term. Couple that with product releases from new vendors, plus expanding portfolios from existing ones; and the fundamentals for this industry appear very strong, even despite headwinds in certain key sectors.”

Software Investments—Looking Beyond the Surface

Software Investments—Looking Beyond the Surface

Rockwell Automation through Blake Moret, chairman and CEO, invested $1 billion in PTC with Moret gaining a seat on the board. The public reason was really to get early information about ThinkWorx, the IIoT product.

The investment valued PTC, a company with $1 billion in sales, at approximately $17 billion. On the surface, we all pondered why.

Speeding up the time, I was able to spend a couple of hours with several people from PTC at last week’s Automation Fair event. This really opened my eyes to the depth and breadth of the ThingWorx offering. There is much technology and usefulness under the hood. This is powerful software.

Now, I understand. Beyond a relationship and most likely some preferential access to ThingWorx and other PTC technologies, I’m surmising that Rockwell Automation can also drop some visualization projects, cut development costs, and utilize the full value of the PTC software. That alone would be a good return on the investment.

Therefore, the most prominent branding at Automation Fair–Powered by PTC.

Revealing more of Rockwell’s piece-at-a-time partnering strategy, it is not using PTC’s CAD and PLM offerings for its digital twin development, but instead it is partnering with ANSYS.

Like I noted in my initial report on Automation Fair, partnering was the centerpiece of news from the event. Looks like it is also the centerpiece of product development. That is most likely financially prudent.

Doing Good—The Other Side of Automation Fair

Doing Good—The Other Side of Automation Fair

We sat through two-and-a-half hours of presentations preparing us (writers, thinkers, journalists) for the coming two days of technical meetings. Speakers included the CEO, various vice presidents, and, oh, yes, three teenaged inventors.

Do not throw up your hands and mutter about “kids these days.” That’s a disservice. I am at an event sponsored by the technology supplier Rockwell Automation called Automation Fair. By the way, the company’s 28th annual gathering and my 22nd visit. The numbers of younger people, women, and “minorities” attending increases every year, and this year kept the trend up and to the left.

But back to the kids. The company sent out a challenge through various social media to students inviting them to invent something that would solve a social problem. The top three were given an all-expense trip (with parents) to Chicago to attend Automation Fair.

These three gave the best presentations of the day–content, presentation skills, poise, command of the audience. Yes, they had mentors, but that’s the key. Instead of complaining about kids, give them a useful challenge and then mentor them.

One project solved a problem with sump pumps not keeping up with ground water resulting in flooded basements. Areas of the US had large amounts of rain this spring and early summer flooding many basements. Many of the audience probably wanted to sign up to buy one.

Bullying remains a serious problem in schools (and other places where kids congregate). One young inventor came up with an anti-bullying backpack. It included a battery pack, two wifi-enabled web cameras, and communication. In a bully situation, the owner could quick-call an authority (parent, administrator, whatever) and show live video of the bullies. It also records to the cloud.

Sanitation kills more people throughout the world than just about anything else–lack of sanitation, that is. In many places, people just defecate in the street or wherever. Simple toilets requiring little to no water to operate widely available would save millions of live. The third young inventor actually invented such a device.

Make a difference. Find a way to mentor someone. Make it a discipline.

One last thing, Maria Kassarjian, executive director of Edesia, spoke on the efforts of her company, by the way using automation technologies from Rockwell, to create nutritional food packs to be sent to areas where malnutrition is a huge problem. The products contain peanuts, a nutritionally dense food, for both nourishment and also to introduce infants to nuts in order to reduce the prevalence of nut allergies.

Follow this blog

Get every new post delivered right to your inbox.